UPDATE 3-Walmart tests iPhone app checkout feature

Reuters Staff

5 Min Read

* Test in one store near company headquarters

* Speeding up checkout could save millions of dollars

* Streamlining checkout is an industry goal -consultant

By Jessica Wohl

Aug 31 (Reuters) - Wal-Mart Stores Inc is testing a system that would allow shoppers to scan items using their iPhones and then pay at a self-checkout counter, a move that could trim checkout times and slash costs for retailers.

If the “Scan & Go” test by the world’s largest retailer is successful, it has the potential to change the way people shop and pay, making the process more personal and potentially faster.

Earlier this week, Walmart invited employees with Apple Inc iPhones to participate in a test at a Walmart supercenter in Rogers, Arkansas, near the company's headquarters, according to a form on the Survey Monkey website. (here)

“All of the effort is to speed your way through the checkout so that we can reduce costs and improve the shopping experience,” said Paul Weitzel, managing partner at retail consulting firm Willard Bishop, who said he had not seen Wal-Mart’s test. “With smartphones and improved technology we’re only going to see more of this.”

The test comes months after Wal-Mart said that it would add more self-checkout lanes at its Walmart and Sam’s Club stores as it continues to look for ways to lower costs and prices for its shoppers.

Pushing more shoppers to scan their own items and make payments without the help of a cashier could save Wal-Mart millions of dollars, Chief Financial Officer Charles Holley said on March 7. The company spends about $12 million in cashier wages every second at its Walmart U.S. stores.

Shoppers often complain on Twitter and in other forums that it takes too long to pay at Walmart, where sometimes only a few of the several checkout lanes are open and staffed with cashiers. While some retailers employ baggers to speed up the checkout process, at Walmart one employee scans and bags items.

“We’re continually testing new and innovative ways to serve customers and enhance the shopping experience in our stores,” said Wal-Mart spokesman David Tovar.

Walmart’s iPhone app already includes functions such as letting shoppers create lists and seeing which items are in stock.

The test comes as retailers and restaurants are trying to figure out ways to speed up the checkout process by letting customers pay with a tap of their smartphones.

In the Walmart iPhone scanning test, shoppers can scan products with their phone and put them in bags while they shop, and then pay at a self-checkout counter.

The test does not allow users to pay on their phone. The app transfers the scanned items to the self-checkout kiosk and then shoppers complete the transaction using the normal self-checkout process.

Walmart declined to give details on where the test might lead, but it could conceivably allow for scanning on other smart phones and be paired with mobile payment.

Wal-Mart earlier this month said it was joining with other retailers to develop a mobile payment network, a retailer-led initiative that would match similar services by Google Inc and eBay Inc, among others.

While self-checkout aisles are common at many stores, the ability to scan items with one’s mobile phone while shopping is not a typical process. Among other tests, Supervalu Inc’s Jewel-Osco chain once let shoppers use handheld scanners and then enter that information at the checkout to pay, but that test ended years ago.

“This is probably the fourth technology that we’ve tried between shopping carts, RFID chips, the handheld scanners and now we’ve got smartphones,” Weitzel said of the retail industry. “We’re looking for ways to improve that experience as an industry.”

Wal-Mart’s test appears to be limited to one store, but it appears that the company sought out participants beyond its staff for its study. The company asked employees to reach out to friends and family in its search for participants, according to a copy of an email sent by the company’s @WalmartLabs team and obtained by Reuters. A company spokesman would not verify this on Friday afternoon.

Wal-Mart offered participants in one-hour sessions $100 for their time and a $25 gift card to use in the store for purchases, according to the form on the Survey Monkey website.

Wal-Mart shares closed up 35 cents at $72.60 on Friday on the New York Stock Exchange.